EDA suppliers regroup in wake of violence

SAN MATEO, Calif.  After making sure all of their employees were accounted for in the wake of the national tragedy, the EDA industry's three largest companies are trying to resume business in anything but usual times.

Cadence Design Systems Inc., Synopsys Inc. and Mentor Graphics Corp. said all of their employees were physically unharmed by the terrorist acts that occurred in New York, Washington and Pennsylvania last week.

"People are trying to get back to business, knowing full well that it is not business as usual," said Chi-Foon Chan, Synopsys president and chief operating officer. Chan said he is thankful that no Synopsys employees were physically harmed in the terrorist attacks.

Chan and Ray Bingham, Cadence president and chief executive, and Wally Rhines, chairman of Mentor Graphics, said that their respective companies took measures immediately following the terrorist attacks to account for all of their employees.

"We have been very fortunate that neither our direct family nor any of the people we work with at customer sites as well as partners have been physically harmed," said Bingham.

Chan said that immediately after the attacks, Synopsys began an orderly procedure to account for all of its employees. Employees were asked to contact their managers, who in turn contacted their managers and so on up the chain of command, finally reaching Chan. Mentor too went through a similar procedure to ensure employees were safe.

Synopsys chairman and chief executive officer Aart de Geus was giving an address at the Synopsys User Group (SNUG) meeting in Boston when word broke about the terrorist acts.

Chan said that the meeting broke up for a few hours so attendees could contact their relatives but said users agreed to resume the meeting later in the day. The SNUG meeting concluded Wednesday afternoon as previously planned, and Synopsys chartered a bus in Boston to transport customers and its employees back to the San Francisco Bay Area.

Employees from Synopsys, Cadence and Mentor, all of which have offices worldwide, were stranded all over the world. Chan said Synopsys gave its global employees the option of going home and is allowing employees who are in the middle of a business tour to come home if they wish.

Bingham told employees to take time to be with their families. The company restricted travel through the end of the week.

Cadence also rescheduled its user group meeting, originally due to take place the week of Sept. 17, to Dec. 3. Also postponed is the EDA front-to-back conference, which was scheduled for the week of Sept. 24. That conference will now be held November 13-15 at the San Jose Convention Center.

"We wanted to take pressure off people to travel at a time when travel infrastructure, and probably their own feelings, work against it," said Bingham. "We'll put it together later in the year, but people have to focus on what is essential."

Chan said that the company for the time being is discouraging employees from traveling and that most meetings are being conducted via teleconferencing and videoconferencing.

Chan said it is difficult to assess what impact the terrorist acts will have on business and the economy in general. "We don't have a clear sense whether it is over  what actions president Bush plans to take," said Chan.

The three executives agree that it will impact the way EDA companies do business, as it is not uncommon for application engineers and salespeople to make trips at a moment's notice to customer sites.

"The fact of the matter is how we conduct business will never be the same again," said Cadence's Bingham. He said that the terrorist attacks will and should trigger a major change in the security procedures at U.S. airports and thus drive up the expense and drive down the frequency of travel.

"I think the days of arriving at the airport 15 minutes before your flight and jumping on an airplane at a moment's notice to go visit a customer are over," said Bingham. He predicts that U.S. security will tighten much in the same way security throughout Europe tightened following the terrorist actions during the 1972 Olympics.

Bingham expects that telecommunication, videoconferencing and customer support through the Internet will become more pervasive in the wake of the terrorist actions and restricted travel.

"I was living in Europe in 1972 when the terrorist attacks occurred at the Olympics in Munich, and I watched a 'happy-go-lucky' Europe become very serious virtually overnight," said Bingham. He talked about a fairly recent experience in which he was detained at a European airport and questioned because he had changed a destination from one U.S. city to another. "I guess that type of a thing is something they European security see as suspicious and associate it with possible terrorism," he said. "It is probably the type of action we are going to have deal with in travel in the United States."

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Rhines said that with the slowing economy, Mentor employees were using more teleconferencing anyway and that under the current conditions will likely use more video and teleconferencing. But Rhines said employees will continue to travel to customer sites.

"It is obvious that traveling will be difficult, but we are resolved not to let this affect us any more than it has to," said Rhines. "We are not going to become insular because of this." Rhines said that Mentor representatives plan to attend events scheduled in Europe over the next couple of months.

The three companies said they are currently reviewing their own internal security procedures and travel policies as a result of the terrorist acts.

"We have reviewed our security and tightened things we are not sure about," said Bingham. "We've been in touch with travel and law enforcement about what kind of measures" should be taken and what destinations should be avoided.

Each of the companies is currently looking at how they can offer relief for the victims of the terrorist attack. Mentor is encouraging its employees to donate money and blood, for example. "We are supporting our employees so they can do what they feel they need to do to help out," said Ry Schwark, director of public and investor relations at Mentor.